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Mylan Inc (NAS:MYL)
Beneish M-Score
-2.44 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Mylan Inc has a M-score of -2.44 suggests that the company is not a manipulator.

MYL' s 10-Year Beneish M-Score Range
Min: -4.16   Max: -1.91
Current: -2.44

-4.16
-1.91

During the past 13 years, the highest Beneish M-Score of Mylan Inc was -1.91. The lowest was -4.16. And the median was -2.44.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Mylan Inc for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 1.1519+0.528 * 0.9725+0.404 * 1.0748+0.892 * 1.0166+0.115 * 1.1875
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9913+4.679 * -0.0268-0.327 * 1.0963
=-2.44

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $1,820 Mil.
Revenue was 1808.526 + 1767.426 + 1701.701 + 1631.49 = $6,909 Mil.
Gross Profit was 795.951 + 808.518 + 742.384 + 693.49 = $3,040 Mil.
Total Current Assets was $4,471 Mil.
Total Assets was $15,236 Mil.
Property, Plant and Equipment(Net PPE) was $1,663 Mil.
Depreciation, Depletion and Amortization(DDA) was $516 Mil.
Selling, General & Admin. Expense(SGA) was $1,412 Mil.
Total Current Liabilities was $2,956 Mil.
Long-Term Debt was $7,586 Mil.
Net Income was 180.232 + 158.908 + 177.689 + 106.882 = $624 Mil.
Non Operating Income was -0.463 + -70.597 + -7.192 + 3.398 = $-75 Mil.
Cash Flow from Operations was 417.86 + 414.662 + 186.48 + 87.561 = $1,107 Mil.
Accounts Receivable was $1,554 Mil.
Revenue was 1722.854 + 1801.786 + 1687.815 + 1583.655 = $6,796 Mil.
Gross Profit was 742.316 + 793.122 + 702.637 + 670.229 = $2,908 Mil.
Total Current Assets was $3,903 Mil.
Total Assets was $11,932 Mil.
Property, Plant and Equipment(Net PPE) was $1,397 Mil.
Depreciation, Depletion and Amortization(DDA) was $547 Mil.
Selling, General & Admin. Expense(SGA) was $1,401 Mil.
Total Current Liabilities was $2,194 Mil.
Long-Term Debt was $5,337 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(1820.273 / 6909.143) / (1554.342 / 6796.11)
=0.26345858 / 0.22871054
=1.1519

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(808.518 / 6796.11) / (795.951 / 6909.143)
=0.42793657 / 0.44004633
=0.9725

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (4471.26 + 1663.076) / 15236.341) / (1 - (3902.717 + 1397.216) / 11931.897)
=0.59738785 / 0.55581807
=1.0748

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=6909.143 / 6796.11
=1.0166

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(546.604 / (546.604 + 1397.216)) / (515.997 / (515.997 + 1663.076))
=0.28120093 / 0.23679656
=1.1875

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(1411.629 / 6909.143) / (1400.747 / 6796.11)
=0.20431318 / 0.20611011
=0.9913

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((7586.459 + 2956.07) / 15236.341) / ((5337.196 + 2193.503) / 11931.897)
=0.69193312 / 0.63114013
=1.0963

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(623.711 - -74.854 - 1106.563) / 15236.341
=-0.0268

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Mylan Inc has a M-score of -2.44 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Mylan Inc Annual Data

Mar04Mar05Mar06Mar07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.94061.70650.81211.12811.04311.06940.87571.09620.98281.1519
GMI 0.95381.1150.99650.95381.2990.98921.00130.97280.97720.9725
AQI 0.77740.83951.1471.86912.18320.99850.99110.98930.95771.0748
SGI 1.08310.91181.0031.28213.18740.99131.07021.12461.10871.0166
DEPI 1.32741.18231.14441.25550.28791.08471.01630.91751.00411.1875
SGAI 1.07561.40950.86720.74591.53341.00560.96680.99391.04020.9913
LVGI 0.65671.15344.09761.08981.16410.96270.98791.09480.94031.0963
TATA 0.03-0.0169-0.1273-0.0642-0.0554-0.0365-0.0479-0.0145-0.0261-0.0268
M-score -2.30-2.09-4.16-2.04-0.34-2.58-2.75-2.41-2.54-2.44

Mylan Inc Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 0.90971.09621.03050.9651.07020.98280.90151.00631.10841.1519
GMI 0.96930.97280.9690.99230.97290.97720.98480.96820.97220.9725
AQI 0.9470.98930.99170.97061.00270.95770.95060.95250.97311.0748
SGI 1.12391.12461.11721.09741.09471.10871.09251.07521.03321.0166
DEPI 0.9210.91750.94390.94860.99531.00411.00591.02351.12651.1875
SGAI 1.00510.99391.02431.03681.0161.04021.01930.96961.00820.9913
LVGI 1.01471.09481.02861.08630.97160.94031.1851.00211.07871.0963
TATA -0.019-0.0145-0.0058-0.0162-0.0262-0.0261-0.0456-0.0307-0.0235-0.0268
M-score -2.59-2.41-2.41-2.56-2.46-2.54-2.79-2.58-2.50-2.44
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